The stage was set for today's U.S. trading session over in Europe where the European Central Bank (ECB) left interest rates unchanged. However, ECB president Mario Draghi also slashed his outlook for GDP growth and inflation, which people interpreted as a signal for future rate cuts. Most European stock markets closed higher as the euro got demolished.

Italian stocks, however, fell and yields rose. According to the Financial Times, former Prime Minister Silvio Berlusconi came out attacking Mario Monti and signaling that he could re-enter politics.

It's jobs week in America. This morning we learned that layoffs spiked in November, but this was largely due to the bankruptcy of Twinkie-maker Hostess. Initial jobless claims fell to 370k from last week's 395k reading. Economists were expecting 380k. Tomorrow, the Bureau of Labor Statistics will publish its November jobs report, which will include an update to the unemployment rate and the number of nonfarm payrolls added.

The market continues to be remarkably sanguine, despite the lack of a fiscal cliff deal. How can we tell if they're making an progress? Well, UBS's Art Cashin suggests we pay attention to payroll withholding schedules. "If taxes are going to change, the Treasury will have to direct companies to prepare new withholding schedules that can be effective and implemented on January 1. That is not an overnight project. Failure to call for the preparation of new schedules hints that the Treasury believes a viable deal is still within reach." See Also: Bloomberg BRIEF's Guide To The Fiscal Cliff >